Following reports of the low solvency ratio of National insurance co & deteriorating financial health of the other insurers namely United India insurance co. & Oriental insurance co., the govt. want to fast track the merger of the three non-life insurance companies. Earlier EY was appointed as consultant to facilitate the smooth merger of the three PSU non-life insurers, who has asked the govt. to provide funds to the tune of Rs. 3000 crores to the insurers for sustainability as per the regulatory norms.
The Govt, in turn has asked the insurers to take corrective measures & revamp their system at the earliest. Following the instructions, the insurance co’s are gearing up to control the mounting underwriting losses & trying to outsource the loss assessment for small ticket claims to some agencies. The national insurance is also going for the in-hose survey route for the losses below Rs. 50000.00 limit for which it has started training programme for its surplus employees.
The latest measure in the series is the companies are also planning to close down some of its offices to cut down the management expanses. The national insurance has approved the closure of three of its Divisional offices, 15 branch offices & 37 Business centers most of which have low premium income & high claim ratio & process for the same has already been initiated. The action is said to helpful in better utilization of the surplus man power from these offices. The detailed list of the offices to be closed with reasoning can be seen through the following link: